Children’s social care costs for councils in England up about £1bn a year

Councils in England are paying far more to look after children in care, and the Local Government Association (LGA) says the bill has grown by about £1 billion a year on average for three years. The rise is already showing up in council budgets, though the sources do not say how much it will add to your council tax.

This article sets out what the figures show, who is likely to feel it, and what you can check locally.

The change in plain English

According to the LGA, citing government data, councils in England spent £9.5 billion supporting looked-after children in 2025/26. That is up from £6.6 billion in 2022/23, an average rise of roughly £1 billion a year. Even after allowing for inflation, spending has risen by 29.1%.

The LGA links the rise to more complex care needs, a shortage of suitable placements and difficulties in commissioning specialist support. Cllr Natalie Oliver, who chairs its Children, Young People and Families Committee, said the figures “highlight the stark financial pressures on councils”. The LGA wants sustainable long-term funding in the Autumn Budget.

Who pays more, and where the pressure lands

The immediate burden falls on council budgets. The sources do not say how any overspend will be covered nationally, so any direct effect on bills will depend on each council’s decisions. What they do show is how heavily the pressure is concentrated.

Southend-on-Sea City Council’s latest financial report forecasts an overspend of £13.291m for 2026/27 after four months. Around 97% of that is in children’s and adult social care. One residential placement there costs more than £1m a year, and eight more cost over £500,000 each annually.

Council leader Cllr Daniel Cowan said: “local taxpayers simply cannot continue carrying the can for social care markets that are fundamentally broken.” Southend says it is tightening controls on discretionary spending, recruitment, consultancy and purchasing. That suggests the first effect for residents may be tighter budgets for other services rather than an immediate bill change, though Southend has not said so.

A worked example: what one placement costs

The Children’s Commissioner for England, Dame Rachel de Souza, published data on children housed in illegal, unregistered homes. These include caravans, holiday camps and AirBnBs. On 1 September there were 669 such children, down from 764 a year earlier. The average weekly cost of a placement was about £10,500, down 5.7% from over £11,100 the year before.

Multiplied over a year, that is £10,500 x 52 weeks, or £546,000 for a single child. The Commissioner’s office said the average placement lasted 184 days, a little over six months. Our own arithmetic puts that at about £276,000 for an average stay (26.3 weeks at £10,500). The Commissioner said 36 placements had already cost £1 million each by 1 September, and that councils spent an estimated £353 million on illegal children’s homes in 2025.

Spread evenly across the 153 local authorities that supplied data, £353 million would be about £2.3 million each. That is only a simple average for illustration, since the real spread will be uneven. It does show how a few high-cost placements can strain a budget, as the Southend figures also do.

What to do now

You cannot change a council’s spending, but you can see how exposed yours is. Start with your council’s website and look for its latest financial performance or budget monitoring report, often published to cabinet or full council several times a year. Look for a forecast overspend and which services drive it.

Next, look at the council’s budget consultation for the coming year, which usually sets out proposed council tax levels and savings. If children’s services are named as a pressure, ask how the council plans to cover it. Many councils take questions at meetings or by email from residents.

Finally, watch the Autumn Budget. The LGA has asked for sustainable long-term funding for children’s social care, but the sources do not say what the Government will decide, and this article does not include a Government response to the LGA’s call. Your council’s confirmed council tax level will come from its own budget-setting, not from the Budget alone.

Your questions answered

Will my council tax go up because of children’s care costs?

The sources do not say. They show rising spending, a £3.2 billion cumulative overspend since 2022/23 and individual councils such as Southend forecasting overspends. How each council responds, and whether it raises bills, is a local decision.

What is an illegal children’s home?

The Children’s Commissioner uses the term for unregistered settings where children in care are placed. Examples include caravans, holiday camps, AirBnBs, hospitals and some supported accommodation. She said 89% were run by private providers, and the practice is already against the law.

Why are placements so expensive?

The LGA points to more complex needs, too few suitable places and difficulty commissioning specialist support. Southend’s report says demand outstrips supply across England, which drives up the prices councils must pay. In the Commissioner’s data, nearly 60% of children in illegal homes had an Education, Health and Care Plan.

What are the LGA and the Children’s Commissioner asking for?

Dame Rachel de Souza called for investment in earlier intervention, keeping children closer to loved ones, and more specialist foster care and children’s homes. The LGA also wants more early help, including health services, alongside sustainable long-term funding.